Case 2:13-cv-05631-HGB-DEK Document 1 Filed 08/28/13 Page 1 of 11

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA

THE ESTATE OF LOUIS D. HAEUSER AND THE ESTATE OF LUCILLE S. HAEUSER D/B/A LOUIS D. HAEUSER INVESTMENT ACCOUNT; LOUIS D. HAEUSER DECKBAR ACCOUNT, LLC, ALBERT MINTZ DECKBAR ACCOUNT, LLC, ESTATE OF RICHARD B. MONTGOMERY, JR. DECKBAR ACCOUNT LLC D/B/A HAEUSER, MONTGOMERY, MINTZ D/B/A DECKBAR COMPANY; AND THE ESTATE OF LOUIS D. HAEUSER, ESTATE OF LUCILLE S. HAEUSER, DANIEL L. HAEUSER, AND LUCILLE HAEUSER-BRIAN D/B/A HAEUSER REALTY VERSUS WESTCHESTER SURPLUS LINES INSURANCE COMPANY * * * * * * * *

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CIVIL ACTION

NO.

SECTION

JUDGE

MAG.

COMPLAINT NOW INTO COURT, through undersigned counsel, come plaintiffs herein, The Estate of Louis D. Haeuser and The Estate of Lucille S. Haeuser d/b/a Louis D. Haeuser Investment Account; Louis D. Haeuser Deckbar Account, LLC, Albert Mintz Deckbar Account, LLC, Estate of Richard B. Montgomery, Jr. Deckbar Account LLC d/b/a Haeuser, Montgomery, Mintz d/b/a Deckbar

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Company; and The Estate of Louis D. Haeuser, The Estate of Lucille S. Haeuser, Daniel L. Haeuser, and Lucille Haeuser-Brian d/b/a Haeuser Realty and for their complaint against the defendant, Westchester Surplus Lines Insurance Company (Westchester), upon information and belief represent as follows: JURISDICTION AND VENUE 1. Jurisdiction in this Court is based on diversity of citizenship under 28 U.S.C. 1332, as the plaintiffs are all residents of the state of Louisiana, as more fully described below; the defendant is a foreign insurance corporation organized and existing under the laws of the State of Georgia, with its principal place of business in Georgia and Pennsylvania; and the amount in controversy exceeds $75,000, exclusive of interest and costs. 2. Venue in this Court is proper under 28 U.S.C. 1391(a), on the grounds that a substantial part of the events giving rise to this claim occurred, and the property that is subject of this action is situated, in this district. THE PARTIES 3. The Estate of Louis D. Haeuser and The Estate of Lucille S. Haeuser d/b/a Louis D. Haeuser Investment Account were the owners of commercial real estate,

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including the following properties: 4921 Jefferson Highway, 4923 Jefferson Highway, 4925 Jefferson Highway, 4925 A Jefferson Highway, 4401-4405 N. Roman Street, 1904 Engineers Road, 105 Lauren Drive, 108 Lauren Drive, 900 L&A Road, 4400 N. Galvez Street, 4402 N. Galvez Street, 4450 N. Galvez Street and 2901 General De Gaulle Avenue. 4. Louis D. Haeuser Deckbar Account, LLC, Albert Mintz Deckbar Account, LLC and Estate of Richard B. Montgomery, Jr. Deckbar Account, LLC d/b/a Haeuser, Montgomery, Mintz d/b/a Deckbar Company are Louisiana limited liability companies and the owners of commercial real estate, including the following properties: 1220 L&A Road, 4709 River Road, 4729 River Road, 4737 River Road, 4745 A River Road, 4750 River Road and 4755 River Road. 5. The Estate of Louis D. Haeuser, the Estate of Lucille S. Haeuser, Daniel L. Haeuser, and Lucille Haeuser-Brian d/b/a Haeuser Realty were the owners of commercial real estate, including the following properties: 2110 L&A Road, 1500 L&A Road, 1028 McDermott Road, 1504 L&A Road, 1508 L&A Road, 1512 L&A Road, 1516 L&A Road, 1520 L&A Road, 1524 L&A Road, 1528 L&A Road and 1028 Justin Road.

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6. Defendant, Westchester, is a commercial insurance company organized and existing under the laws of a state other than Louisiana, with its principal place of business in a state other than Louisiana. THE CLAIM 7. Westchester issued a policy of commercial property insurance providing various types of coverage, including building and rental value coverage, with respect to the above listed scheduled properties owned by these plaintiffs, all located within the state of Louisiana and this judicial district. The Westchester policy, policy no. D36083074 006 (hereafter the Westchester policy), was in effect from 1 July 2012 through 1 July 2013 and provided replacement cost coverage for damage to the scheduled properties listed above caused by a broad range of perils including, but not limited to, wind and wind-driven rain. 8. On or about 28 August 2012, Hurricane Isaac swept through the New Orleans metropolitan area, causing substantial damage. Among other things, the above listed properties owned by the plaintiffs and covered by the Westchester policy sustained damage, including substantial damage caused by wind and/or wind-driven rain.

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9. Plaintiffs currently estimate that the total replacement cost to replace the damage to their properties caused by wind, wind-driven rain and other perils covered under the Westchester policy amounts to $1,331,117.68. After applying the policys Windstorm Percentage Deductible (the deductible), plaintiffs total replacement cost for covered losses and damages to the scheduled properties listed above under the Westchester policy amounts to $1,094,641.75. Plaintiffs expressly reserve their right to supplement and amend this estimate as additional information becomes available. 10. Shortly after Hurricane Isaac, plaintiffs, through their representatives, notified the defendant of the damage to the various properties covered under the Westchester policy. The defendants adjusters and/or roofing consultants have inspected the above listed properties damaged by Hurricane Isaac for the purpose of quantifying plaintiffs covered losses and damages and adjusting plaintiffs replacement cost coverage claims. 11. However, despite the defendants inspections of the properties involved, its liberal use of consultants, and its receipt of documentation establishing the extent of plaintiffs losses, the defendant and its adjusters failed to timely adjust and pay

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the plaintiffs replacement cost coverage claims. Moreover, despite the abundant information available to it, the defendant has grossly undervalued the full extent of the plaintiffs replacement cost covered losses and damages, and has to date only agreed to pay plaintiffs an aggregate of $208,848.35. FIRST CAUSE OF ACTION BREACH OF CONTRACT 12. Westchesters failure to pay plaintiffs the full replacement cost owed for losses and damages to the properties covered under the Westchester policy constitutes a breach of Westchesters contractual obligations to these plaintiffs. Westchesters breach of its policy of insurance entitles plaintiffs to a damage award equal to $885,793.40, the full amount of the replacement cost for the losses and damages to their property less the amount previously paid by defendant, which has been improperly and unjustly denied by defendant. SECOND CAUSE OF ACTION BREACH OF DUTY TO PROPERLY ADJUST INSURANCE CLAIM AND ARBITRARY AND CAPRICIOUS FAILURE TO PROVIDE TIMELY PAYMENT AFTER RECEIPT OF SATISFACTORY PROOF OF LOSS 13. As early as September 2012, the defendant had available the necessary information and documentation establishing the full extent of plaintiffs losses and damages of their properties. From that information, it was undisputed, and indisputable, that plaintiffs were entitled to substantial loss payments by

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Westchester for the replacement cost coverage provided by the Westchester policy. Yet, defendant paid plaintiffs nothing. It was only after plaintiffs hired counsel and repeatedly pressed plaintiffs claim for coverage under the policy that defendant paid plaintiffs anything. And then, when it did agree to pay, defendant agreed to pay plaintiffs far less than their documented losses and damages covered under the Westchester policy. 14. Further, defendant blatantly and implicitly misrepresented its policy provisions by adamantly and repeatedly, but incorrectly, maintaining to plaintiffs that the $100,000 minimum per occurrence windstorm deductible applied separately (per location) to each of the plaintiffs scheduled properties damaged by Hurricane Isaac. By misrepresenting the policys deductible, defendant sought to severely and improperly limit the plaintiffs recoverable losses to far less than what plaintiffs are entitled to recover under the Westchester policy. This significant misrepesentation of the deductible provisions of its own policy caused the defendant to effectively deny coverage for the losses to plaintiffs properties caused by Hurricane Isaac, which substantially hampered plaintiffs ability to fund necessary repairs to their properties. It was only after plaintiffs retained counsel and their counsel challenged defendants misrepresentation of the deductible provision that defendant reversed its erroneous position and conceded that the

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$100,000 minimum windstorm deductible applied only once per occurrence to all damage in the aggregate, not per location as defendant previously maintained. 15. In January 2013, in response to plaintiffs demand for an interim loss payment of $317,788.57, defendant made a meager initial payment to plaintiffs totaling $150,000 on only two properties, without any explanation for this reduced loss payment. In April 2013 defendant made a second payment totaling $58,848.35, without a proper explanation for this reduced loss payment or the tardiness of this payment. Moreover, defendant admitted that these payments were undisputed amounts for verified Isaac related damage. These payments were issued more than 60 days after plaintiffs submitted satisfactory proof of loss for these properties. 16. Defendants delay in paying undisputed and indisputable covered losses and damages, its misrepresentation of the deductible provisions in its own policy, and its gross undervaluation of plaintiffs covered losses and damages, has caused plaintiffs damage by delaying plaintiffs restoration of the damaged properties and their return to their full economic use. Moreover, defendants mishandling of this matter has needlessly forced plaintiffs to incur expenses, including but not limited to attorneys fees, engineering fees, expert fees and costs, in an effort to compel

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defendant to properly comply with its clear contractual obligations to these plaintiffs. 17. Defendant breached its duty to properly adjust this insurance claim by misrepresenting its policy provisions, by purposefully minimizing the scope and extent of the physical damage to the properties caused by Hurricane Isaac, and by failing to pay the amount of the claim within 60 days of receipt of satisfactory proof of loss. Defendants failure to properly adjust plaintiffs insurance loss and damage and failure to timely pay plaintiffs the full replacement cost for covered losses was reckless, arbitrary, capricious, willful and without probable cause. Accordingly, plaintiffs are entitled to damages, penalties, attorneys fees, engineering and construction evaluation fees and costs under La. R.S. 22:1892 and 22:1973 and other applicable provisions of Louisiana law. MISCELLANEOUS 18. Plaintiffs expressly reserve the right to supplement and amend the allegations of this Complaint, if necessary and appropriate, based on the discovery of additional information.

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19. All and singular, the foregoing allegations are true and correct and within the jurisdiction of this Honorable Court. WHEREFORE, plaintiffs, The Estate of Louis D. Haeuser and The Estate of Lucille S. Haeuser d/b/a Louis D. Haeuser Investment Account; Louis D. Haeuser Deckbar Account, LLC, Albert Mintz Deckbar Account, LLC, Estate of Richard B. Montgomery, Jr. Deckbar Account LLC d/b/a Haeuser, Montgomery, Mintz d/b/a Deckbar Company; and The Estate of Louis D. Haeuser, The Estate of Lucille S. Haeuser, Daniel L. Haeuser, and Lucille Haeuser-Brian d/b/a Haeuser Realty pray that: 1. Defendant, Westchester Surplus Lines Insurance Company, be

summoned to appear and answer, all and singular, the allegations of this Complaint; 2. After due proceedings, judgment be entered herein in favor of

plaintiffs and against defendant for the unpaid amount of covered losses to which plaintiffs are entitled under the Westchester policy, presently estimated at $885,793.40, or such other amount as may be proven at trial, plus damages, penalties, attorneys fees, engineering and construction evaluation fees, costs and interest; and

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3.

They be granted all such other relief that justice and the nature of the

case will allow. Respectfully Submitted: MURPHY, ROGERS, SLOSS & GAMBEL

/s/ Robert H. Murphy ____________________________________________ Robert H. Murphy (#9850) Peter B. Sloss (#17142) Jeffrey A. Raines (#11076) One Shell Square, Suite 400 701 Poydras Street New Orleans, LA 70139 Telephone: 504-523-0400 Telecopier: 504-523-5574 Attorneys for Plaintiffs

PLEASE SERVE: Westchester Surplus Lines Insurance Company Through its Designated Agent for Service of Process Louisiana Secretary of State 8585 Archives Avenue Baton Rouge, LA 70809
1485/4525

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